UNM Constructing a Stronger Regional Economic Development Strategy

UNM President Robert Frank has received his final report from the UNM Economic Development Summit and is beginning to consider ways in which the university can most effectively participate in developing the regional and state economy.

One of the most startling findings is the assessment of the number of new jobs that must be created in the next few years to minimize the effect of losing jobs in the government and private sectors that began with the 2007 recession. Mark Lautman, of Lautman Economic Architecture which put together the report, says "This effort by UNM is especially timely because the economy of New Mexico is headed toward a fiscal cliff."

This report squarely faces the economic scenario if the current congressional sequestration is allowed to take effect.

"As we mark the Centennial, New Mexico finds itself in the midst of the greatest economic crisis since statehood," said Lautman. "After losing between 40,000 and 50,000 jobs, in the worst recession in history, the state is on the brink of a suffering a second, even more devastating cycle of job losses from the downsizing of the federal government operations in New Mexico. The ABQ Metro area is in its 40th consecutive month of job contraction. Communities with UNM sites (Taos, Los Alamos, Rio North, Gallup, and Valencia) are each facing similar economic and demographic crises of their own."

After factoring in natural population growth, the New Mexico economy will need to create more than 100,000 net new jobs to recover to pre-recession employment levels by 2022. This would require 40,000 jobs to replace those lost since the recession, and the additional 50,000 jobs toreplace those lost from sequestration and the taking of New Mexico's federal jobs. If another 10,000 additional new jobs are needed to support new population growth in the decade ahead, the state would have to create a total of 100,000 new jobs to return to 2007 employment levels. To achieve this, the state will have to create 40,000 net new economic base jobs to trigger the 60,000 jobs expected to be added in the service sector.

This is a worst case scenario. If the congressional sequestration is navigated successfully, the New Mexico economy may not continue to contract so swiftly, but the report points out that the best way to mitigate the slide is to take positive action now.

The report contains specific suggestions in three main areas. One is the rainforest approach in which the university supports students and faculty as they create intellectual property and start companies based on their research.

The second is the employer sector approach in which UNM works directly with companies and individuals in creating and filling jobs that align with specific industry sectors the state is seeking to build.

The third approach is capacity building and would involve using UNM assets such as the Bureau of Business and Economic Research (BBER) to do market research, economic and demographic analysis and strategic planning for state and local job creation. It would also involve UNM personnel working to convert the academic, business and government communities to more aggressively prepare for an entrepreneurial economy.

An Economic Development Advisory Group (EDAG), appointed by President Frank and chaired by Doug Brown, dean of the Anderson School of Management, has already begun to develop a map for future action by the university.